SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) April 16, 1998
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Base Ten Systems, Inc.
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(Exact Name of Registrant as Specified in Charter)
New Jersey 0-7100 22-1804206
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(State or Other Jurisdiction (Commission (I.R.S. Employer
Of Incorporation) File Number) Identification No.)
One Electronics Drive, Trenton, New Jersey 08619
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (609)586-7010
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Inapplicable
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(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events.
On April 16, 1998, at the Annual Shareholder's Meeting of Base Ten
Systems, Inc. (the "Company"), the shareholders of the Company approved the
amendment of the Certificate of Incorporation to modify certain terms of the
Class A Common Stock and the Class B Common Stock. The modifications will
increase the exchange ratio for conversion of Class B Common Stock from 1:1 to
1:1.5, change the voting rights of the Class A Common Stock and the Class B
Common Stock with respect to the election of directors so that the directors of
the Company will be elected by holders of Class A Common Stock and Class B
Common Stock voting together as a single class; make the voting rights of both
classes the same so that they have the same voting power; eliminate a separate
vote by class of Class B Common Stock holders on certain corporate transactions;
and change the dividend restriction so that Class A Common Stock and Class B
Common Stock receive the same dividends.
In December 1997, the National Association of Securities Dealers, Inc.
(the "NASD") notified the Company that it proposed to de-list the Class B
Common Stock from the Nasdaq SmallCap Market because the number of holders of
Class B Common Stock appears to have fallen below 300 beneficial owners. The
Company proposed these amendments to alleviate certain of the negative impact of
such de-listing of the Class B Common Stock, and the NASD granted to the Company
a temporary exception, until May 1, 1998, in order to permit the Company to
effect these amendments. Following the close of business on May 1, 1998,
however, the Class B Common Stock will no longer be listed on the Nasdaq
SmallCap Market. The Class A Common Stock will continue to be listed on the
Nasdaq National Market.
This Current Report on Form 8-K also sets forth the description of the
Company's capital stock following the above-described modification of certain
terms of the Class A Common Stock and the Class B Common Stock.
DESCRIPTION OF CAPITAL STOCK
General
The authorized capital stock of the Company currently consists of
40,000,000 shares of Class A Common Stock, 2,000,000 shares of Class B Common
Stock and 999,500 shares of Preferred Stock, all of which have a par value of
$1.00 per share. The Company has designated 18,975 shares of the Preferred Stock
as Series A Preferred Stock.
Common Stock
Dividends. Both classes of the Company's Common Stock have identical
cash and property dividend rights. Cash or property dividends can be declared
and paid on the Class A Common Stock and Class B Common Stock as a single class.
If a dividend is paid, the same amount shall be paid in respect of each
outstanding share of Class A Common Stock or Class B Common Stock.
If at any time a distribution is to be paid in Class A Common Stock or
Class B Common Stock (a "share distribution"), only shares of Class A Common
Stock may be paid to holders of Class A Common Stock and only shares of Class B
Common Stock may be paid to holders of Class B Common Stock. Whenever a share
distribution is paid, the same number of shares shall be paid in respect of each
outstanding share of Class A Common Stock or Class B Common Stock. The Company
shall not combine or subdivide shares of either of such classes without at the
same time making a proportionate combination of shares of the other of such
classes.
Voting Rights. Except for class votes as required by law or the
Company's Certificate of Incorporation (and subject to voting rights that may be
granted to any holders of Preferred Stock), holders of both classes of common
stock vote or consent as a single class on all matters, including the election
of directors, with each share of Class A Common Stock and each share of Class B
Common Stock having one vote per share.
All directors of the Company who have previously been elected by the
holders of Class A Common Stock as a class and all directors who had previously
been elected by the holders of Class B Common Stock as a class shall be
considered as having been elected by the holders of Class A Common Stock and
Class B Common Stock voting together.
The holders of Class A Common Stock and Class B Stock shares, voting as
a single class, shall be entitled to vote as a separate class on the removal,
for cause, of any director (subject to voting rights of Preferred Stock).
Conversion. At the option of the holder of record, each share of Class
B Common Stock is convertible at any time into one and one-half (1.5) shares of
Class A Common Stock (subject to adjustment in the event of a capital
reorganization, reclassification, consolidation, merger or sale of all or
substantially all of the Company's assets, as provided in the Certificate of
Incorporation). The Class A Common Stock is not convertible.
Other Rights. Shareholders of the Company's common stock have no
preemptive or other rights to subscribe for additional shares. On liquidation,
dissolution or winding up of the Company, all shareholders of common stock,
regardless of class, are entitled to share ratably in any assets available for
distribution. No shares of either class are subject to redemption. All
outstanding shares are fully paid and non-assessable.
Transfer Agent. The transfer agent and registrar for shares of the
Class A Common Stock and Class B Common Stock is American Stock Transfer & Trust
Company, 40 Wall Street, New York, New York 10005.
Preferred Stock
General. The Company's Board of Directors is empowered to fix the designations,
powers, preferences and relative, participating, optional or other special
rights of the Preferred Stock and the qualifications, limitations or
restrictions of those preferences or rights.
Series A Preferred Stock. As of April 16, 1998, the Company had issued 18,975
shares of Series A Preferred Shares. Holders of Series A Preferred Shares have
the following rights, privileges and preferences:
Term; Dividends and Illiquidity Payments. The Series A Preferred Shares
have a term of three years and pay a cumulative dividend of 8.0% per annum
during any quarter in which the closing bid price for the Class A Common Stock
is less than $8.00 for any 10 consecutive trading days. An equivalent payment is
payable to any holder of Series A Preferred Shares which is subject during any
quarter to a standstill period (as described below) following a Company
underwritten public offering or which is non-convertible because of the
limitations described below. Such dividends and payments are payable only prior
to conversion, and payable in cash or additional Series A Preferred Shares at
the Company's option; however, if the Company elects to pay the dividend in
Series A Preferred Shares, the amount of such payment will be 125% of the cash
amount due.
Liquidation Preference. The Series A Preferred Shares have a
liquidation preference as to principal amount and any accrued and unpaid
dividends.
Conversion Rights. The Series A Preferred Shares are convertible at any
time or from time to time into Class A Common Stock, at a conversion price equal
to the lesser of (i) $16.25 per share, or (ii) the Weighted Average Price of the
Class A Common Stock prior to the conversion date. Weighted Average Price is
defined as the volume weighted average price of Class A Common Stock on NASDAQ
(as reported by Bloomberg Financial Markets) over any two trading days in the 20
trading day period ending on the day prior to the date the holder gives notice
of conversion (excluding the lowest closing bid price in the period). The holder
has the right to select such two days. No more than 3,040,000 shares of Class A
Common Stock shall be issued upon conversion of all of the Series A Preferred
Shares, except for additional shares of Class A Common Stock issuable pursuant
to anti-dilution provisions and certain adjustments to the conversion price in
certain circumstances. Any Series A Preferred Shares remaining outstanding
because of this limitation may be redeemed at the holder's option for a
subordinated 8% promissory note maturing when the Series A Preferred Shares
would have matured.
Company Redemption Right. The Company has the right, at any time, to
redeem all or any part of the outstanding Series A Preferred Shares or
subordinated notes at 130% of their original purchase price.
Mandatory Redemption on Maturity. Any Series A Preferred Shares or
subordinated notes still outstanding three years after issuance must be redeemed
in either cash or at the Company's option, in Class A Common Stock. If the
Company elects to make the redemption in Class A Common Stock, the amount of
such payment will be 125% of the original purchase price.
Voting Rights. The holders of the Series A Preferred Shares have the
same voting rights as the holders of Class A Common Stock, calculated as if all
outstanding shares of Series A Preferred Shares had been converted into shares
of Class A Common Stock on the record date for determination of shareholders
entitled to vote on the matter presented.
Warrants. For each $1 million of the Series A Preferred Shares
purchased, the purchaser received five-year warrants to purchase 40,000 shares
of Class A Common Stock exercisable at $16.25 per share.
Right of First Refusal. So long as the Series A Preferred Shares remain
outstanding, each holder has the right (with certain exceptions) to purchase, on
five days notice, up to that portion of any future equity financing by the
Company which would be sufficient to enable the holder to maintain its
percentage interest in the Company's equity on a fully diluted basis.
Five Percent Limitation. The holders of the Series A Preferred Shares
are not entitled to receive shares of Class A Common Stock upon a conversion to
the extent that the sum of (i) the number of shares of Class A Common Stock
beneficially owned by the holder and its affiliates (exclusive of shares of
Class A Common Stock issuable upon conversion of the unconverted portion of the
Series A Preferred Shares and shares of Class A Common Stock issuable upon
conversion or exercise of any other securities of the Company) and (ii) the
number of shares of Class A Common Stock issuable upon conversion of the Series
A Preferred Shares then being converted, would result in beneficial ownership by
the holder and its affiliates of more than 4.9% of the outstanding Class A
Common Stock.
Registration. The Company granted the holders of the Series A Preferred
Shares mandatory registration rights with respect to the resale of the shares of
Class A Common Stock underlying the Series A Preferred Shares (including any
Series A Preferred Shares which may be issued as a dividend) and the shares of
Class A Common Stock underlying the warrants issued to the holders of the Series
A Preferred Shares. The holders of the Series A Preferred Shares have agreed, if
requested by a managing underwriter, to a 90-day standstill period following any
underwritten Company public offering during which period the holders may not
sell the Class A Common Stock underlying both the Series A Preferred Shares and
the warrants issued to the holders, but not in excess of two such standstills in
any 18-month period. In the event a standstill period is effective, the maturity
date of the Series A Preferred Shares would be extended by the duration of the
standstill period.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits
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3(d) Amendment to Certificate of Incorporation filed on March 31,
1998.
3(e) Amendment to Certificate of Incorporation filed on April 21,
1998.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Dated: April 23, 1998
BASE TEN SYSTEMS, INC.
THOMAS E. GARDNER
By:_________________________
Thomas E. Gardner
President, Chairman and
Chief Executive Officer
BASE TEN SYSTEMS, INC.
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
BASE TEN SYSTEMS, INC.
Base Ten Systems, Inc., a corporation (the "Corporation")
organized under the laws of the State of New Jersey, to amend its Certificate of
Incorporation in accordance with Section 14A:7-2 and 14A:7-18 of Chapter 7 of
the New Jersey Business Corporation Act, hereby certifies:
FIRST: The name of the Corporation is Base Ten Systems, Inc.
SECOND: The Board of Directors of the Corporation, by unanimous written
consent dated March 31, 1998, adopted resolutions (attached as Appendix A
hereto) providing for the cancellation of 500 shares of the Company's
Convertible Preferred Shares, Series A and the related reduction of the
authorized number of Preferred Shares and Convertible Preferred Shares, Series
A; and the issuance of 475 shares of Convertible Preferred Shares, Series A and
the related increase in the authorized number of Convertible Preferred Shares,
Series A.
THIRD: After giving effect to the cancellation of 500 shares of the
Corporation's Convertible Preferred Shares, Series A, the total number of shares
that the Corporation is authorized to issue is 24,999,500 and the aggregate par
value of all such shares is $24,999,500. Twenty-two million of the shares shall
be Class A Common shares of a par value of $1.00 each. Two million of the shares
shall be Class B Common shares of a par value of $1.00 each. Nine hundred
ninety-nine thousand five hundred of the shares shall be Preferred shares of a
par value of $1.00 each. After giving effect to the issuance of 475 shares of
the Corporation's Convertible Preferred Shares, Series A, 18,975 of the
Preferred shares shall be Convertible Preferred Shares, Series A.
FOURTH: Article 6(d)(J) of the Certificate of Incorporation states that
any Convertible Preferred Shares, Series A, which are converted, purchased,
redeemed or otherwise acquired by the Corporation, shall be retired and canceled
by the Corporation promptly thereafter, and that no such shares shall upon their
cancellation be reissued.
FIFTH: The Corporation's Certificate of Incorporation is amended as
follows:
Article 6(a) of the Certificate of Incorporation of the Company be
amended to read, in its entirety, as follows:
"(a) This corporation is authorized to issue three classes of shares of
stock to be designated "Class A Common," "Class B Common," and
"Preferred." The total number of shares that this corporation is
authorized to issue is 24,999,500 and the aggregate par value of all
such shares is $24,999,500. Twenty-two million of the shares shall be
Class A Common shares of a par value of $1.00 each. Two million of the
shares shall be Class B Common shares of a par value of $1.00 each.
Nine hundred ninety-nine thousand five hundred of the shares shall be
Preferred shares of a par value of $1.00 each."
Article 6(d)(A) of the Certificate of Incorporation of the Company be
amended to read, in its entirety, as follows:
"(d) A. Designation and Amount. The shares of this series of Preferred
Shares shall be designated as "Convertible Preferred Shares, Series A"
and the number of shares constituting such series shall be 18,975, with
a par value of $1.00 per share. Fractional Preferred Shares shall be
permitted. The number of Preferred Shares may be increased, subject to
and in accordance with the New Jersey Business Corporation Act, without
approval of the existing holders of Preferred Shares, solely for the
purposes of issuance pursuant to Section C(1) hereof."
SIXTH: The action of the Board of Directors in amending Article 6(a) of
the Certificate of Incorporation is made pursuant to Section 14A:7-18(1), and
the action of the Board of Directors in amending Article 6(d)(A) of the
Certificate of Incorporation is made pursuant to Section 14A:7-2(2), in each
case by unanimous written consent of the Board of Directors.
SEVENTH: This Certificate of Amendment shall become effective upon
filing.
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IN WITNESS WHEREOF, Base Ten Systems, Inc. has caused its duly
authorized officer to execute this Certificate on this 31st day of March, 1998.
BASE TEN SYSTEMS, INC.
THOMAS E. GARDNER
By:_______________________________
Name: Thomas E. Gardner
Title: President and Chief Executive Officer
Attest:
WILLIAM F. HACKETT
By:______________________________
Name: William F. Hackett
Title: Secretary
<PAGE>
APPENDIX A
RESOLUTIONS
<PAGE>
1. RESOLVED, that the Board hereby approves the cancellation of 500 shares
of the Company's Convertible Preferred Shares, Series A, reacquired by
the Company by the conversion thereof, and the reduction of the
authorized number of Preferred Shares from 1,000,000 to 999,500, and
the reduction of the authorized number of Convertible Preferred Shares,
Series A, from 19,000 to 18,500; and be it
FURTHER RESOLVED, that Article 6(a) of the Certificate of Incorporation
of the Company be amended to read, in its entirety, as follows:
"(a) This corporation is authorized to issue three classes of shares of
stock to be designated "Class A Common," "Class B Common," and
"Preferred." The total number of shares that this corporation is
authorized to issue is 24,999,500 and the aggregate par value of all
such shares is $24,999,500. Twenty-two million of the shares shall be
Class A Common shares of a par value of $1.00 each. Two million of the
shares shall be Class B Common shares of a par value of $1.00 each.
Nine hundred ninety-nine thousand five hundred of the shares shall be
Preferred shares of a par value of $1.00 each."
2. WHEREAS, 500 shares of the Company's Convertible Preferred Shares,
Series A, have been canceled, thereby reducing the authorized number of
Preferred Shares from 1,000,000 to 999,500 and reducing the authorized
number of Convertible Preferred Shares, Series A, by 500 shares; and
WHEREAS, the Board proposes to pay dividends due on March 31, 1998 on
the Company's Convertible Preferred Shares, Series A, in Convertible
Preferred Shares, Series A, in accordance with Article 6, Section C(1)
of the Certificate of Incorporation, which would have the effect of
increasing the authorized number of Convertible Preferred Shares,
Series A, by 475 shares; and
WHEREAS, the net effect of (i) canceling 500 shares of the Convertible
Preferred Shares, Series A, and the related reduction in the authorized
number of Convertible Preferred Shares, Series A, and (ii) paying
dividends on the Convertible Preferred Shares, Series A, in 475 shares
thereof and the related increase in the authorized number of Preferred
Shares, Series A, is the reduction of the authorized number of
Convertible Preferred Shares, Series A, from 19,000 to 18,975 shares;
and be it
RESOLVED, that the Board hereby approves the payment of dividends due
on March 31, 1998 on the Company's Convertible Preferred Shares, Series
A, payable in Convertible Preferred Shares, Series A, in accordance
with Article 6, Section C(1) of the Certificate of Incorporation, and
the increase in the authorized number of Convertible Preferred Shares,
Series A, by 475 shares; and be it
FURTHER RESOLVED, that Article 6(d)(A) of the Certificate of
Incorporation of the Company be amended to read, in its entirety, as
follows:
"(d) A. Designation and Amount. The shares of this series of Preferred
Shares shall be designated as "Convertible Preferred Shares, Series A"
and the number of shares constituting such series shall be 18,975, with
a par value of $1.00 per share. Fractional Preferred Shares shall be
permitted. The number of Preferred Shares may be increased, subject to
and in accordance with the New Jersey Business Corporation Act, without
approval of the existing holders of Preferred Shares, solely for the
purposes of issuance pursuant to Section C(1) hereof."
3. RESOLVED, that the Board hereby authorizes, directs and empowers each
of Thomas E. Gardner and William F. Hackett, to act individually or
jointly on behalf of the Company to execute and deliver the amendment
to the Certificate of Incorporation of the Company to effect the
foregoing resolutions.
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
BASE TEN SYSTEMS, INC.
Base Ten Systems, Inc., a New Jersey corporation, to amend its
Certificate of Incorporation in accordance with Sections 14A:9-2(4) and 14A:7 et
seq. of the New Jersey Business Corporation Act, hereby certifies:
FIRST: The name of the corporation is Base Ten Systems, Inc.
SECOND: Article 6(a) of the Certificate of Incorporation of the
corporation is amended to read in its entirety, as follows:
"(a) This corporation is authorized to issue three classes of shares of
stock to be designated "Class A Common," "Class B Common," and
"Preferred." The total number of shares that this corporation is
authorized to issue is 42,999,500 and the aggregate par value of all
such shares is $42,999,500. Forty million of the shares shall be Class
A Common shares of a par value of $1.00 each. Two million of the shares
shall be Class B Common shares of a par value of $1.00 each. Nine
hundred ninety-nine thousand five hundred of the shares shall be
Preferred shares of a par value of $1.00 each."
THIRD: Article 6(c) of the Certificate of Incorporation of the
corporation is amended to read in its entirety, as follows:
"(c) Except as set forth in this Article 6(c), the Class A Common
shares and Class B Common shares shall be identical in all respects and
shall have equal rights and privileges.
A. Dividends and Distributions
(1) Subject to rights of the Preferred shares granted pursuant to this
Certificate of Incorporation, the corporation may pay dividends to
holders of Class A Common shares and Class B Common shares, as a single
class. If a dividend is paid, the same amount shall be paid in respect
of each outstanding Class A or Class B Common share.
(2) If at any time a distribution is to be paid in Class A Common
shares or Class B Common shares (a "share distribution"), only Class A
Common shares may be paid to holders of Class A Common shares and only
Class B Common shares may be paid to holders of Class B Common shares.
Whenever a share distribution is paid, the same number of shares shall
be paid in respect of each outstanding Class A or Class B Common share.
The corporation shall not combine or subdivide shares of either of such
classes without at the same time making a proportionate combination or
subdivision of shares of the other of such classes.
B. Voting.
(1) The holders of Class A and Class B Common shares shall in all
matters vote together as a single class (subject to voting rights that
may be granted to any holders of Preferred shares pursuant to Article
6(c) of this Certificate of Incorporation), the holders of Class A
Common shares and Class B Common shares are entitled to one vote for
each share. The directors of the corporation elected by the holders of
Class A Common shares and by the holders of Class B Common shares shall
be considered as having been elected by the Class A Common shares and
the Class B Common shares voting together as a single class
notwithstanding that prior to the effective date of the Amendment to
the Certificate of Incorporation inserting this sentence, the directors
may have been elected by a separate class.
(2) The holders of Class A Common shares and Class B Common shares,
voting as a single class, shall be entitled to vote as a separate class
on the removal, for cause, of any director (subject to voting rights of
Preferred shares granted pursuant to Article 6(c) of this Certificate
of Incorporation).
(3) Any vacancy in the office of a director may be filled by a vote of
holders of shares entitled to vote (subject to voting rights of the
Preferred shares granted pursuant to Article 6(c) of this Certificate
of Incorporation) and, in the absence of a stockholder vote, the
vacancy may be filled by the remaining directors as provided in the
By-laws. Any director elected by the Board of Directors to fill a
vacancy shall serve the same remaining term as that of his predecessor
and until his or her successor has been chosen and has qualified. If
permitted by the By-laws, the Board of Directors may increase the
number of directors and any vacancies so created may be filled by the
Board of Directors.
<PAGE>
(4) The holders of the Class A Common shares and the holders of the
Class B Common shares shall be entitled to vote as separate classes on
such other matters as may be required by law or this Certificate of
Incorporation to be submitted to such holders voting as separate
classes.
C. Conversion. Each holder of record of Class B Common shares may at
any time or from time to time, in such holder's sole discretion and at
such holder's option, convert any whole number of all of such holder's
Class B Common shares into fully paid and non-assessable Class A Common
shares at the rate (subject to adjustment as hereinafter provided) of
one and one-half Class A Common share for each Class B Common share
surrendered for conversion. Any such conversion may be effected by any
holder of Class B Common shares surrendering such holder's certificate
or certificates for the Class B Common shares to be converted, duly
endorsed, at the office of the corporation or any transfer agent for
the Class B Common shares, together with a written notice to the
corporation at such office that such holder elects to convert all or a
specified number of Class B Common shares and stating the name or names
in which such holder desires the certificate or certificates for such
Class A Common shares to be issued. Promptly thereafter, the
corporation shall issue and deliver to such holder or such holder's
nominee or nominees, a certificate or certificates for the number of
Class A Common shares to which such holder shall be entitled as
aforesaid. Such conversion shall be deemed to have been made at the
close of business on the date of such surrender and the person or
persons entitled to receive the Class A Common shares issuable on such
conversion shall be treated for all purposes as the record holder or
holders of such Class A Common shares on that date.
The number of Class A Common shares into which the Common shares may be
converted shall be subject to adjustment from time to time in the event
of any capital reorganization, reclassification of the stock of the
corporation, consolidation or merger of the corporation with or into
another corporation or sale or conveyance of all or substantially all
of the assets of the corporation to another corporation or other entity
or person. Each Class B Common share shall thereafter be convertible
into such kind and amount of securities or other assets, or both, as
are issuable or distributable in respect of the number of Class A
Common shares into which each Class B Common share is convertible
immediately prior to such reorganization, reclassification,
consolidation, merger sale or conveyance. In any such case, appropriate
adjustments shall be made by the Board of Directors of the corporation
in the application of the provisions herein set forth with respect to
the rights and interests thereafter of the holders of Class B Common
shares, to the end that the provisions set forth herein (including
provisions for adjustment of the conversion rate) shall thereinafter be
applicable, as nearly as reasonably may be, in relation to any
securities or other assets thereafter deliverable on conversion of the
Class B Common shares.
No fraction of a Class A Common share shall be issued on conversion of
any Class B Common share but, in lieu thereof, the corporation shall
pay in cash therefor the pro rata fair market value of any such
fraction. Such fair market value shall be based, in the case of
publicly traded securities, on the last sale price for such securities
on the business day next prior to the date such fair market value is to
be determined (or, in the event no sale is made on that day, the
average of the closing bid and asked prices for that day on the
principal stock exchange on which Class A Common shares are traded or,
if the Class A Common shares are not then listed on any national
securities exchange, the average of the closing bid and asked prices
for that day quoted by the NASDAQ System) or, in the case of other
property, the fair market value on such day determined by a qualified
independent appraiser expert in evaluating such property and appointed
by the Board of Directors of the corporation. Any such determination of
fair market value shall be final and binding on the corporation and on
each holder of Class B Common shares or Class A Common shares.
The corporation shall at all times reserve and keep available out of
the authorized and unissued Class A Common shares, solely for the
purpose of effecting the conversion of the outstanding Class B Common
shares, such number of Class A Common shares as shall from time to time
be sufficient to effect the conversion of all outstanding Class B
Common shares and if, at any time, the number of authorized and
unissued Class A Common shares shall not be sufficient to effect
conversion of the then outstanding Class B Common shares, the
corporation shall take such corporate action as may be necessary to
increase the number of authorized and unissued Class A Common shares to
such number as shall be sufficient for such purposes.
The Preferred shares may be issued from time to time in one or more
series. The Board of Directors is hereby authorized to fix or alter the
designations, preferences, and relative, participating, optional or
other special rights, and qualifications, limitations or restrictions,
of such Preferred shares, including without limitation of the
generality of the foregoing, dividend rights, dividend rates,
conversion rights, voting rights, rights and terms of redemption
(including sinking fund provisions), the redemption price or prices and
liquidation preferences of any wholly unissued series of Preferred
shares, and the number of shares constituting any such series and the
designation thereof, or any of them; and to increase or decrease the
number of shares of that series, but not below the number of shares of
such series then outstanding. In case the number of shares of any
series shall be so decreased, the shares constituting such decrease
shall resume the status which they had prior to the adoption of the
resolution originally fixing the number of shares of such series."
FOURTH: Article 8 of the Certificate of Incorporation of the
corporation is amended to read in its entirety, as follows:
"Any merger, consolidation of the corporation, or sale, lease, exchange
or other disposition of all, or substantially all, the assets of the
corporation, if not in the usual and regular course of its business as
conducted by the corporation, shall require the affirmative vote of
seventy-five percent of the votes cast by holders of shares entitled to
vote thereon."
FIFTH: The amendments to the Certificate of Incorporation set forth in
Paragraphs SECOND, THIRD, and FOURTH of this Certificate were adopted by the
shareholders of the corporation on April 16, 1998.
SIXTH: The designation and number of shares of each class or series
entitled to vote on the amendments to the Certificate of Incorporation set forth
in Paragraphs SECOND, THIRD, and FOURTH of this Certificate, is as follows:
<TABLE>
<CAPTION>
Class or Series Number of Shares
- -------------------------- ----------------
<S> <C>
Class A Common Stock 7,854,068
Class B Common Stock 445,121
Series A Preferred Stock 19,000
</TABLE>
SEVENTH: The number of shares of each class or series voting together
as a single class (each share of Class A Common Stock having one-tenth of one
vote per share; each share of Class B Common Stock having one vote per share;
each share of Series A Preferred Stock having one-tenth of one vote per share,
calculated as if all shares of Series A Preferred Stock had been converted into
shares of Class A Common Stock on the record date) voted for or against the
amendment to Article 6(a) of the Certificate of Incorporation set forth in
Paragraph SECOND of this Certificate is as follows:
<TABLE>
<CAPTION>
For Against
Class or Series Shares Votes Shares Votes
- ------------------------ ----------------------- -----------------
<S> <C> <C> <C> <C>
Class A Common Stock 7,351,462 735,146 258,526 25,853
Class B Common Stock 416,153 416,153 2,618 2,618
Series A Preferred Stock 0 0 0 0
</TABLE>
EIGHTH: The vote of (i) the holders of Class A Common Stock, voting as
a class, (ii) the holders of Class B Common Stock, voting as a class, and (iii)
the holders of Class A Common Stock, Class B Common Stock and Series A Preferred
Stock, voting together as a group, was required in connection with the
amendments to Articles 6(c) and 8 of the Certificate of Incorporation set forth
in Paragraphs THIRD and FOURTH of this Certificate. The number of shares of each
class or series (each share of Class A Common Stock having one-tenth of one vote
per share; each share of Class B Common Stock having one vote per share; each
share of Series A Preferred Stock having one-tenth of one vote per share,
calculated as if all shares of Series A Preferred Stock had been converted into
shares of Class A Common Stock on the record date) voted for or against the
amendments to Articles 6(c) and 8 of the Certificate of Incorporation set forth
in Paragraphs THIRD and FOURTH of this Certificate is as follows:
<PAGE>
With respect to the amendment of Article 6(c)(C) (Proposal 4(a) of the Notice of
Meeting (the "Notice") changing the conversion ratio of the Class B Common
Stock):
<TABLE>
<CAPTION>
For Against
Class or Series Shares Votes Shares Votes
- -------------------------- ------------------------ ----------------
<S> <C> <C> <C> <C>
Class A Common Stock 2,994,407 299,441 238,641 23,864
Class B Common Stock 319,573 319,573 7,762 7,762
Series A Preferred Stock 0 0 0 0
</TABLE>
With respect to the amendment of Article 6(c)(B) (Proposal 4(b) of the Notice
changing the voting rights of the Class A Common Stock and the Class B Common
Stock with respect to the election of directors):
<TABLE>
<CAPTION>
For Against
Class or Series Shares Votes Shares Votes
- ------------------------- ------------------------ -------------------
<S> <C> <C> <C> <C>
Class A Common Stock 3,055,986 305,599 168,396 16,840
Class B Common Stock 319,041 319,041 8,294 8,294
Series A Preferred Stock 0 0 0 0
</TABLE>
With respect to the amendment of Article 6(c)(B) (Proposal 4(c) of the Notice
changing the voting rights of Class A Common Stock):
<TABLE>
<CAPTION>
For Against
Class or Series Shares Votes Shares Votes
- --------------------------- ------------------------ --------------------
<S> <C> <C> <C> <C>
Class A Common Stock 3,095,756 309,576 135,513 13,551
Class B Common Stock 319,041 319,041 8,294 8,294
Series A Preferred Stock 0 0 0 0
</TABLE>
<PAGE>
With respect to the amendment of Article 8 (Proposal 4(d) of the Notice
eliminating a separate vote by Class B Common Stock for certain corporate
transactions):
<TABLE>
<CAPTION>
For Against
Class or Series Shares Votes Shares Votes
- -------------------- ------------------------ -----------------------
<S> <C> <C> <C> <C>
Class A Common Stock 3,070,681 307,068 150,450 15,045
Class B Common Stock 319,041 319,041 8,294 8,294
Series A Preferred Stock 0 0 0 0
</TABLE>
With respect to the amendment of Article 6(c)(A) (Proposal 4(e) of the Notice
changing the dividend restriction for Class B Common Stock):
<TABLE>
<CAPTION>
For Against
Class or Series Shares Votes Shares Votes
- --------------------- ------------------------ -----------------------
<S> <C> <C> <C> <C>
Class A Common Stock 3,056,009 305,601 162,923 16,292
Class B Common Stock 321,568 321,568 5,767 5,767
Series A Preferred Stock 0 0 0 0
</TABLE>
With respect to conforming revisions contained throughout Article 6 (Proposal
4(f) of the Notice to make conforming language changes to reflect the changes
set forth in Proposals 4(a) through 4(e) of the Notice):
<TABLE>
<CAPTION>
For Against
Class or Series Shares Votes Shares Votes
- --------------------- ------------------------ -----------------------
<S> <C> <C> <C> <C>
Class A Common Stock 7,454,534 745,453 143,798 14,380
Class B Common Stock 415,993 415,993 5,129 5,129
Series A Preferred Stock 0 0 0 0
</TABLE>
<PAGE>
NINTH: This Certificate of Amendment shall become effective upon
filing.
IN WITNESS WHEREOF, Base Ten Systems, Inc. has caused its duly
authorized officer to execute this Certificate on this 16th day of April, 1998.
BASE TEN SYSTEMS, INC.
THOMAS E. GARDNER
By:_______________________________
Name: Thomas E. Gardner
Title: President and Chief Executive Officer
